AOL is betting $120 million this year on a network of local news Websites called Patch.

It's overseen by Arianna Huffington.

Clayton Moran of the Benchmark Group says AOL's fate will "hinge on the success or failure of Patch.”

Patch has about 800 editors and more than 100 sales people.

We spoke to one salesperson – candidly self-described as a "disgruntled employee" – about the state of things.

This person was not very optimistic.

We briefed a Patch spokesperson on this story, but she declined to comment.

BUSINESS INSIDER: Earlier this year, Patch gave its sales people the option of switching to an incentive-laden compensation package that included a smaller salary, but a potentially higher net payout. You described this to me as a defacto pay cut. Why?

I guess you could make the argument that the commission structure would be juicier. The problem is that the commission structure is very tough to attain given the lack of product and the very low retention rate.

What happens is, people in the sales teams that are successful have to sell the product to an ignorant lot of small business owners that can't differentiate between branding and performance-driving results.

How's company morale?

Sales have dropped dramatically so there's a tremendous morale problem within Patch. The editorial staff has been worked to death and they've already changed it over once, effectively. The same thing is going on the with sales force.

You say you don't believe Patch makes sense financially. How come?

When it gets down to paying the editors, paying the sales staff, paying the management and the requisite expenses that go along with that, the numbers just do not compute. The advertising cannot support the local Patch model the way it stands. From a dollar standpoint, it simply will not add up.

How are sales?

They had a price increase a couple of months ago, and it's been a disaster because it was already overpriced to begin with from a competitive standpoint. Rates went up 10% to 20% depending on the Patch.

Here's the real issue with Patch: They're selling a branding advertising campaign to small businesses that should never put their first dollar in that bucket. It should be on Google AdWords, where it's measurable and it's cost effective, whether it's a Groupon or AdWords type play.

The problem with Patch is that if you really look at the model, banner ads have been around for 15-20 years online, and it's essentially an old product with a new twist on it from a local new standpoint.

If you look at LivingSocial or Groupon, that makes perfect sense in this day and age because it's measurable and it's identifiable in this day and age, it's transparent. Patch is on the other end of that continuum. It's brand advertising to companies that should not even consider that for dollar one, much less their last dollar.

The other thing you said was that they can't bring products to market. Was there a specific…..

They've been talking about a Groupon type product since October. You and I with a good programmer could design a daily deal product in a matter of hours or days. They can't figure out the phone app part of it. They're essentially going to bring out a 1.0 version of what Groupon's about to launch on a 2.0-like scale. They'll be behind the curve on that before it even gets going.

What's the root of all these problems?

It's leadership, or lack thereof. They have the wrong people in leadership capacities, partly because they were so hasty in building the model and trying to be first to market that they forgot that quality people are essential to getting anything off the ground.

I've never ever seen anything as bad as Patch, ever.

Are you a Patch, AOL, or HuffingtonPost employee? We'd like to learn more. Reach out to Nicholas@businessinsider.com or 646 376 6014.

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It's amazing, totally back to the future, 1997. Remember Microsoft Sidewalk? Arguably, conditions are different now and this business should succeed. But I fear no one is really looking at the past, preferring to forget it.

I thought I'd try to balance the impressionistic generalizations of one anonymous former Patch employee by offering some of my own. I'll put my name on mine (and perhaps risk the wrath of Patch's PR group for going off the reservation).

I'm a Patch editor. I'm very busy, and this is the best job I've ever had. There have been some long days, and some hard days, but I don't feel "worked to death." Out of all the other editors I know, I only know a small handful who might say otherwise. I think the editorial staff's morale is at least okay, if not actually pretty good. I can also say that good internal measures have been taken to give staffers an outlet for candidly airing concerns and comparing notes.

I can't speak directly to my sales. Even if I were prepared to share actual numbers, I couldn't, because I don't know what they are. In fact, editors are very strongly discouraged from discussing advertising on Patch for fear of compromising our journalistic integrity (you know, that thing that people like to claim AOL/Patch doesn't care about).

I can say that each week I field at least a few unsolicited queries from parties that want to place an advertisement on my site. I politely forward these to the local account manager.

My site has exceeded its readership targets from the starting gun; the speed with which the local population has discovered Patch has surprised me. Anyone who came to my area and claimed there was no market here for the Patch product would sound pretty ignorant. I don't know much about selling ads, but to the extent that it involves having eyeballs to put on them, Patch is golden in my area.

Dave, thank you for being courageous enough to post this under your real name. I took a look at your own Patch and you don't have any ads on your front page, and 3 local-business ads on your article pages. That doesn't seem like very much to me. So if you're getting all these calls from people wanting to advertise, that don't end up on actual ads, you may want to figure out why that is. Do they think you're getting more traffic than you actually do? Are you too expensive? Maybe a little follow up would help.